Subj : Ericsson sells US call-routing business iconectiv for $1bn
To   : All
From : TechnologyDaily
Date : Mon Aug 19 2024 12:00:06

Ericsson sells US call-routing business iconectiv for $1bn

Date:
Mon, 19 Aug 2024 10:54:20 +0000

Description:
Ericsson anticipates freeing up around $1 billion to focus on its core 
business areas as revenues fluctuate.

FULL STORY
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Ericsson has agreed to sell its US-based subsidiary iconectiv to Koch Equity 
Development LLC for approximately 10.6 billion Swedish kronor ($1 billion). 

The deal is expected to provide Ericsson with a one-off earnings before 
interest and taxes benefit of around 8.8 billion kronor ($800 million) upon 
completion. 

iconectiv, which has been part of the Swedish telecomms giant's portfolio 
since its acquisition in 2012, has operated within Ericssons Segment 
Enterprise. Ericsson will sell iconectiv for $1 billion 

iconectiv specializes in number portability, core network and operations 
management, numbering and data exchange services. Despite its healthy 
finances, contributing around $100 million to Ericssons 2023 net income, the 
companies have not been as strategically aligned as initially hoped. 

Ericsson has co-owned iconectiv with private equity firm Francisco Partners 
since 2017  its sale to Koch is considered a strategic move that will allow 
Ericsson to refine its business focus. 

The transaction, subject to customary closing conditions and regulatory 
approvals, is expected to be completed in the first half of 2025. Ericsson 
anticipates a cash benefit of around $1 billion after accounting for 
anticipated taxes, transaction expenses, and other liabilities. 

Proceeds from the sale could help Ericsson streamline its operations and 
focus on core areas of its business, helping it to bolster its financial 
position in an evolving telecomms market. 

The Swedish firm declared a 7% decrease in net sales last quarter, compared 
with the year before, but the 12% increase over the preceding quarter shows 
signs of recovery. More from TechRadar Pro Fancy an upgrade? Check out the 
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international travel Ericsson set to cut 1,400 jobs as 5G demand slows



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Link to news story:
https://www.techradar.com/pro/ericsson-sells-us-call-routing-business-iconecti
v-for-dollar1bn


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